China has launched the National Venture Capital Guidance Fund, with increased investment to be directed at early-stage projects and enterprises in sectors including integrated circuits, artificial intelligence (AI), aerospace, and low-altitude economy.

China Launches National Venture Capital Guidance Fund to Boost Investment in Early-Stage Projects Such as AI

According to reports from China Central Television (CCTV) News and China Finance Information Network, the National Venture Capital Guidance Fund was officially launched on Friday (December 26). Concurrently, three regional funds—the Beijing-Tianjin-Hebei Venture Capital Guidance Fund, the Yangtze River Delta Venture Capital Guidance Fund, and the Guangdong-Hong Kong-Macao Greater Bay Area Venture Capital Guidance Fund—were established and put into operation.

At the launching ceremony of the National Venture Capital Guidance Fund held on the same day, the relevant responsible person of the Ministry of Finance stated that the new features of the fund include greater financial support from the government. In addition, the fund has a more precise investment positioning, with a clear orientation of "investing early, investing small, investing long-term, and investing in hard technology". It focuses on cutting-edge fields such as artificial intelligence, biopharmaceuticals, quantum technology, and 6G, and its lifespan of 15 to 20 years is designed to match the long-cycle R&D needs of hard technology sectors.


Another feature is the strong leverage effect of the fund. The responsible person noted that the fund adopts a three-tier structure consisting of the guidance fund, regional funds, and sub-funds. At the levels of regional funds and sub-funds, it will actively engage local governments, financial institutions, state-owned enterprises, private enterprises, and other entities. With hundreds of billions of yuan in fiscal capital, it is expected to leverage trillions of yuan in social capital.

Bai Jingyu, Director-General of the Department of Innovation and High-Tech Development of the National Development and Reform Commission, said at a press conference that in terms of investment, the fund will adhere to the orientation of "investing early, investing small, investing long-term, and investing in hard technology" to guide and drive the development of the venture capital market. Addressing the current phenomena in the venture capital market such as a rush into popular tracks, cherry-picking of projects, and an eagerness for quick results, the guidance fund will prioritize early-stage investments, with seed-stage and start-up enterprises as its primary targets. The investment scale in such enterprises will account for no less than 70% of the fund's total size. Meanwhile, it will stick to investing in small enterprises, requiring that the valuation of the small enterprises to be invested in shall be below 500 million yuan (approximately 91.37 million Singapore dollars), and that the single investment by the fund shall not exceed 50 million yuan, ensuring that funds directly reach the front-end and grassroots sectors of various industries.

Bai Jingyu also stated that moving forward, the guidance fund will continue to make efforts in two aspects. On the one hand, it will pool various types of social capital and integrate financial models into future industries. Together with fund management institutions, the guidance fund will focus on regions with vibrant innovation and entrepreneurship activities, increase investment in early-stage projects and enterprises in sectors such as integrated circuits, artificial intelligence, aerospace, low-altitude economy, biomanufacturing, and future energy, and strive to drive joint investments from various financial institutions and private capital.

On the other hand, it will gather various innovation elements to provide high-quality services for the development of innovative enterprises. While providing financial support, the guidance fund will also build a high-quality, widely accessible, and comprehensive venture capital service system. Through the establishment of a national comprehensive service platform, it will offer value-added services such as corporate governance, strategic planning, human resources, and industrial cooperation to invested enterprises, accompanying their growth in the long run.

China has launched the National Venture Capital Guidance Fund, with increased investment to be directed at early-stage projects and enterprises in sectors including integrated circuits, artificial intelligence (AI), aerospace, and low-altitude economy.

China Launches National Venture Capital Guidance Fund to Boost Investment in Early-Stage Projects Such as AI

According to reports from China Central Television (CCTV) News and China Finance Information Network, the National Venture Capital Guidance Fund was officially launched on Friday (December 26). Concurrently, three regional funds—the Beijing-Tianjin-Hebei Venture Capital Guidance Fund, the Yangtze River Delta Venture Capital Guidance Fund, and the Guangdong-Hong Kong-Macao Greater Bay Area Venture Capital Guidance Fund—were established and put into operation.

At the launching ceremony of the National Venture Capital Guidance Fund held on the same day, the relevant responsible person of the Ministry of Finance stated that the new features of the fund include greater financial support from the government. In addition, the fund has a more precise investment positioning, with a clear orientation of "investing early, investing small, investing long-term, and investing in hard technology". It focuses on cutting-edge fields such as artificial intelligence, biopharmaceuticals, quantum technology, and 6G, and its lifespan of 15 to 20 years is designed to match the long-cycle R&D needs of hard technology sectors.


Another feature is the strong leverage effect of the fund. The responsible person noted that the fund adopts a three-tier structure consisting of the guidance fund, regional funds, and sub-funds. At the levels of regional funds and sub-funds, it will actively engage local governments, financial institutions, state-owned enterprises, private enterprises, and other entities. With hundreds of billions of yuan in fiscal capital, it is expected to leverage trillions of yuan in social capital.

Bai Jingyu, Director-General of the Department of Innovation and High-Tech Development of the National Development and Reform Commission, said at a press conference that in terms of investment, the fund will adhere to the orientation of "investing early, investing small, investing long-term, and investing in hard technology" to guide and drive the development of the venture capital market. Addressing the current phenomena in the venture capital market such as a rush into popular tracks, cherry-picking of projects, and an eagerness for quick results, the guidance fund will prioritize early-stage investments, with seed-stage and start-up enterprises as its primary targets. The investment scale in such enterprises will account for no less than 70% of the fund's total size. Meanwhile, it will stick to investing in small enterprises, requiring that the valuation of the small enterprises to be invested in shall be below 500 million yuan (approximately 91.37 million Singapore dollars), and that the single investment by the fund shall not exceed 50 million yuan, ensuring that funds directly reach the front-end and grassroots sectors of various industries.

Bai Jingyu also stated that moving forward, the guidance fund will continue to make efforts in two aspects. On the one hand, it will pool various types of social capital and integrate financial models into future industries. Together with fund management institutions, the guidance fund will focus on regions with vibrant innovation and entrepreneurship activities, increase investment in early-stage projects and enterprises in sectors such as integrated circuits, artificial intelligence, aerospace, low-altitude economy, biomanufacturing, and future energy, and strive to drive joint investments from various financial institutions and private capital.

On the other hand, it will gather various innovation elements to provide high-quality services for the development of innovative enterprises. While providing financial support, the guidance fund will also build a high-quality, widely accessible, and comprehensive venture capital service system. Through the establishment of a national comprehensive service platform, it will offer value-added services such as corporate governance, strategic planning, human resources, and industrial cooperation to invested enterprises, accompanying their growth in the long run.